Chinese banks to see limited credit risk impact from COVID-19: analyst

Xinhua
23 May 2020, 14:51 GMT+10

BEIJING, May 23 (Xinhua) -- The impact of the novel coronavirus disease (COVID-19) on the asset quality and credit risks of Chinese banks is limited and short-lived, an analyst said.

As China implements pro-growth policies, the fundamentals of the financial sector will gradually improve, supporting the stable growth of banks, especially large-scale ones, said Tang Shengbo, head of China financial research for Nomura, a financial service firm.

The country's lenders reported better-than-expected first quarter results, Tang noted, adding that the adverse effects of the epidemic have not yet fully been reflected in Q1 results, and are likely to pressure banks' earnings in the second and third quarters.

Tang expected the sector to bottom out by Q3 as the economy gradually stabilizes.

China has been leveraging a series of monetary and fiscal measures to channel much-needed funds into the coronavirus-hit companies while keeping financial risks under control.

The country's macro leverage ratio has increased in the first quarter as a result of counter-cyclical policies aimed at supporting the resumption of work by companies, but the hike is only temporary and will eventually trend down after companies resume operations, the central bank said earlier in May.

Watch latest videos

News RELEASES

Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to China National News.

More Information

26 ℃

Light Rain in Shanghai/Hongqiao

International

Section

News Corp shuts down 112 historic Australian newspapers

SYDNEY, NSW, Australia - The largest publisher of newspapers in Australia, Rupert Murdoch's News Corp has closed 112 suburban and ...

U.S. president to step up pressure on Facebook, Twitter

WHITE HOUSE - U.S. President Donald Trump will sign an executive order Thursday regarding social media platforms, after Twitter tagged ...

Hair salons adapt to evolving new standards

When this writer recently looked into the mirror and took a good look at how long his hair had grown ...

How London's 100 or so billionaires are faring

Over cups of tea in his ramshackle London home I chatted with a novelist. It felt a valuable opportunity, given ...

Are the Golden Days over?

As lockdown measures start to be eased in most countries around the world, the experts of The Conversation's global network ...

Australian-based News Corp reporter and whistleblower escape charges

CANBERRA, Australia - Australian Federal Police said Wednesday they were dropping an investigation of a prominent journalist who obtained classified ...